• ECB upgrades growth & inflation outlook through 2020.
• Bulls seemed unimpressed as the majority wants open-ended QE.
• Upbeat US macro data boosts USD and adds to the downward pressure.
As the ECB presser got underway, the EUR/USD pair gained some traction and refreshed fresh multi-day tops during the early NA session.
The pair caught some fresh bids after the ECB upgraded its economic growth forecast for 2017/18/19. According to the latest projections, the region's GDP growth for 2017 is now seen at 2.4% as compared to 2.2% seen in September. For 2018, 2019 and 2020, economic growth forecast stood at 2.3%, 1.9% and 1.7% respectively.
The central bank also revised its inflation outlooks for 2017/18/19/20, but the upward revision was less than expected by the market participants. The ECB President Mario Draghi also reiterated that a downside risk for inflation might come from foreign exchange movements, which further contributed towards capping any additional gains for the shared currency.
Moreover, today's better-than-expected US macro data - monthly retail sales and weekly jobless claims, provided some immediate respite for the US Dollar bulls, with the pair reversing around 40-pips from session tops to currently trading around the 1.1810 region, or session lows.
Technical levels to watch
Immediate support remains near the 1.1800 handle, below which the pair is likely to slide back to 1.1765 horizontal support before eventually dropping to 1.1740 level.
On the upside, mid-1.1800s now becomes immediate resistance, above which the pair is likely to aim towards reclaiming the 1.1900 handle.
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